Question;DeVry University;ACCT346 Weekly Assignment;Week 5;Directions: Please;note that Question #1 has two parts and Question #2 has three parts. Be sure to show your work for full credit and;use the boxes provided. Please add more;rows or columns to a box if more room is needed.;1. Palmer's Gourmet;Chocolates produces and sells assorted boxed chocolates. The unit selling price;is $50 per box, unit variable costs are $25 per box, and total fixed costs for;the company are $2,000.;1a. How many boxes of chocolates must Palmer's Gourmet;Chocolates sell to breakeven?;1b. What are;breakeven sales in dollars?;2. Extreme Sports;received a special order for 1,000 units of its extreme motorbike at a selling;price of $250 per motorbike. Extreme Sports has enough extra capacity to accept;the order. No additional selling costs will be incurred. Unit costs to make and;sell this product are as follows: direct materials, $100, direct labor, $50;variable manufacturing overhead, $14, fixed manufacturing overhead, $10.;2a. List the relevant;costs for the decision of whether or not to accept the special order.;2b. What will be the;change (difference) in operating income if Extreme Sports accepts the special;order?;2c. Should Extreme;Sports accept the special order? Why or;why not?;3. Totally Technology;manufactures two product lines: Cameras and Video Recorders. The company's;product line income statement follows;Camera Video Recorder Total;Sales revenue $300,000;$100,000 $400,000;Cost of goods sold;Variable $75,000 $49,000 $124,000;Fixed $82,000 $28,000;$110,000;Total cost of goods sold $157,000;$77,000 $234,000;Gross profit $143,000;$23,000 $166,000;Marketing and administrative expenses;Variable $25,000 $28,000 $53,000;Fixed $32,000 $19,000;$51,000;Total marketing and administrative expenses $57,000 $47,000;$104,000;Operating income (loss) $86,000;(24,000) $62,000;Management is considering discontinuing the Video Recorder;product line. Accountants for the company estimate that discontinuing the Video;Recorder line will decrease fixed cost of goods sold by $10,000 and fixed;marketing and administrative expenses by $4,000.;Prepare an analysis supporting your opinion about whether or;not the Video Recorder product line should be discontinued.
Paper#38743 | Written in 18-Jul-2015Price : $24